The flat is a 556 sq ft unit in Telford Gardens, where three women and two girls died in 1998 after drinking "holy water" offered by a fung shui master. The "holy water" contained cyanide.

"Home-seekers have become more cautious amid rumours the government will soon announce more property curbs," said Patrick Chow Moon-kit, the research head at Ricacorp Properties.

Demand for "haunted homes" increased last month as home-seekers went bargain hunting in anticipation of a rise in property prices.

Agents said the recovery in the real estate market last month narrowed the discount on "haunted" houses.

Owners of "haunted" homes usually offer them at prices substantially below market rates.

"But now, as demand has dropped as a result of policy risks, home-seekers have become more picky," Chow said.

For this particular flat, however, there might have been other factors at play for the poor response.

Ng Goon-lau, who has bought more than 20 spooky properties, said buyer interest for such flats depended on the circumstances of the death on the premises.

"They (the people who died there) did not kill themselves, they were murdered," Ng said.

Murder victims, in fung shui, were more likely to want to "return", making flats with murder connections worse than those with suicides. Taking into account the "murder factor", Ng said, the asking price was too high.

Agents said the flat had been put on the market for HK$2.4 million last year. A unit with the same size in the estate costs about HK$6 million.